Revenue during the quarter grew 5.10 percent to $20.25 million from $19.27 million in the previous year period. Gross margin for the quarter contracted 682 basis points over the previous year period to 49.56 percent. Total expenses were 92.48 percent of quarterly revenues, up from 84.84 percent for the same period last year. That has resulted in a contraction of 764 basis points in operating margin to 7.52 percent.

Operating income for the quarter was $1.52 million, compared with $2.92 million in the previous year period.

Commenting on the results, Mr. Saar Koursh, chief executive officer of Magal, said, "2016 was an improved year for Magal, both in terms of the core financial results but especially from a strategic standpoint. In 2016, we continued to increase the portion of our higher margin product revenues, which now stands at 54% of the total. In addition, recurring revenue increased to 20% of sales and we expect these positive trends to continue into 2017. During the year, we invested significant resources in beefing up Aimetis sales operations in North America. While this has had a negative impact on our profitability in 2016, we believe that it will bring us strong revenue growth already in 2017 in verticals that we have not been present in yet. We have also recently seen a solid level of bookings, and our expectations for 2017 are for increased sales and operating profitability."